PRINTER'S NO. 3177

THE GENERAL ASSEMBLY OF PENNSYLVANIA

HOUSE BILL

No.

2344

Session of

2024

INTRODUCED BY BOROWSKI, TAKAC, PROBST, DONAHUE, GIRAL, SANCHEZ,

MAYES, KHAN, GUENST, DELLOSO, CIRESI, WAXMAN, KRAJEWSKI,

HILL-EVANS, CERRATO, KRUEGER, BOYD, DALEY, KAZEEM, O'MARA AND

providing the powers and duties of the State Health

Coordinating Council, health systems agencies and Health Care

Policy Board in the Department of Health, and State Health

Facility Hearing Board in the Department of Justice;

providing for certification of need of health care providers

and prescribing penalties," providing for health systems

protection; imposing a fine; and promulgating regulations.

The General Assembly of the Commonwealth of Pennsylvania

hereby enacts as follows:

Section 1. The act of July 19, 1979 (P.L.130, No.48), known

shall have the meanings given to them in this section unless the

context clearly indicates otherwise:

"Acquired entity." The entity, or portion of an entity,

acquired under an agreement or transaction.

"Acquisition." An agreement, arrangement or activity the

consummation of which results in a person acquiring direct or

indirect control of another person. The term includes the

acquisition of voting securities and noncorporate interests,

including assets, capital stock or membership interests or

equity interests.

care commerce or unfair or deceptive acts or practices in or

affecting health care commerce.

(3) Reduced quality of care, including the ability to

offer culturally competent and appropriate care.

(4) Reduced access to or availability of health care for

payers, purchasers or consumers.

(5) Reduced access to care in a rural, low-income or

disadvantaged community.

"Agreement or transaction." An agreement or transaction as

described under section 803-C(a).

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of the target firm health system or as a dividend, return of

capital or other distribution in respect of the target firm

health system's capital stock or other equity interest.

"Community health needs assessment." An assessment that

complies with the requirements of 26 U.S.C. § 501(r)(3)

(relating to exemption from tax on corporations, certain trusts,

etc.).

"Contracting affiliation." As follows:

entity with carriers or third-party administrators over

rates for professional medical services.

(2) The term does not include an arrangement among

entities under common ownership.

"Health system." One or more health care facilities that are

owned by a common legal entity or that have entered into an

affiliation agreement to combine or coordinate delivery of

health care services under a common organizational name.

"Material amount." An amount equal to $10,000,000 or more.

"Material change." Any of the following:

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organization that is valued at a material amount.

(3) A capital distribution or similar reduction of a

health system's equity capital by a material amount or the

incursion of an obligation that commits the health system to

making a capital distribution or similar reduction of equity

by a material amount.

"Merger." A consolidation of two or more organizations,

including two or more organizations joining through a common

persons, whether incorporated or not, which is in the business

of health care delivery or management and that represents seven

or more physicians in contracting with carriers or third-party

administrators for the payment of health care services. The term

includes a physician organization, physician-hospital

organization, independent practice association, provider network

or accountable care organization.

Section 802-C. Transactions against public interest.

(a) General rule.--Except as provided under subsection (b),

a person may not enter into an agreement or transaction

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Section 803-C. Filing.

(a) General rule.--A health system or provider organization

shall file a notification in accordance with subsection (c) and

shall observe the waiting period under subsection (b) prior to

entering into an agreement or transaction that results in a

material change.

(b) Waiting period.--A health system or provider

organization shall undergo a waiting period prior to entering

notification to the extent completed and a statement of

the reasons for noncompliance with subsection (c) from

both persons; and

(2) end:

(i) ninety days following the date of receipt under

paragraph (1) for all agreements or transactions; or

(ii) on a later date as may be prescribed under

subsection (d) or section 808-C.

(c) Notice.--The notification of the transaction or

agreement required under subsection (a) shall be submitted to

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(2) All complete transaction documents with attachments,

including collateral or ancillary agreements involving

officers, directors or employees .

(3) All documents signed by the principals, or their

agents, that are necessary to determine the proposed

transaction's effect, if any, on related or subsidiary

business entities, whether nonprofit or for profit .

(4) Any of the following that comprise part or all of

system if that transaction involves a hospital, including any

changes in contracts between the integrated delivery system

entities and related physician groups .

(6) All financial documents of the transaction parties

and related entities, if applicable, including audited

financial statements, ownership records, business projection

data, current capital asset valuation data and any records

upon which future earnings, existing asset values and fair

market value analysis can be based .

(7) All fairness opinions and independent valuation

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buy-out provisions, profit-sharing agreements and severance

packages .

(10) All information and representations disclosing

related party transactions that are necessary to assess

whether the transaction is at arm's length or involves self-

dealing .

(11) All documents relating to noncash elements of the

transaction, including pertinent valuations of security for

entities, that may affect the interests of the parties .

(14) All information in the possession of the

transacting parties relative to the perspective of the health

system's patient base and communities served, or their

representatives .

(15) All information, including internal and external

reports and studies, bearing on the effect of the proposed

transaction on the availability or accessibility of health

care in the affected community .

(16) A complete list of all insurance plans under

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deems necessary for review purposes.

(d) Additional information and waiting period extensions.--

(1) The Attorney General may, prior to the expiration of

the waiting period under subsection (b), require the

submission of additional information or documentary material ,

including a community health needs assessment, from a person

required to file notification under subsection (c), or from

any officer, director, partner, agent or employee of the

(i) all of the additional information and

documentary material requested; or

(ii) if the request is not fully complied with, the

information and documentary material submitted and a

statement of the reasons for the noncompliance.

(3) A further extension of the waiting period required

under subsection (b) must be granted by a court in accordance

with section 806-C(2)(ii) .

(e) Right-to-Know Law.-- A document provided to the Attorney

General under this chapter shall be exempt from public access

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conduct one or more public hearings on the proposed agreement or

transaction.

(b) Format.--A public hearing required under subsection (a)

shall be live-streamed on the Attorney General's publicly

accessible Internet website. A video recording of the public

hearing shall be posted on the Attorney General's publicly

accessible Internet website.

(c) Specific entities.--If any agreement or transaction

General may request testimony at a hearing from State agencies

subject to section 807-C(c).

(d) Notice.--A t least 14 days before the date of the public

hearing, the Attorney General shall provide written notice of

the date, time and place of the public hearing:

(1) on the Attorney General's publicly accessible

Internet website;

(2) through social and broadcast media;

(3) through publication in one or more newspapers of

general circulation in the affected community; and

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